In round numbers, RIANovosti reports that Russia’s federal budget is $400 billion per year, indicating that the government counts $200 billion per year from oil and gas sales towards its annual budget. However, the Russians understand the volatility of oil and gas prices, so they do not count all of the revenue in good years as available for the annual budget.
Instead, Russia directs “windfall” revenues that come when prices and production are above a planned level into the Russian Reserve Fund. By current law, oil and gas revenues that exceed 3.7% of planned Gross Domestic Product (GDP) for a given year are directed into the Russian Reserve Fund. The Reserve Fund has a legislated balance cap of 10% of GDP.
The most recently reported balance of the Reserve Fund was $38 billion as of late February 2013.
Russia is using financial resources to provide financing for buyers (Hungary, India etc…) of their nuclear plants.
Russia has a very strong program of decarbonization that is based on a doubling of domestic hydroelectricity and an increase in nuclear generation from the current 16% to approaching 50% by 2050.
Russia has announced plans to lend Hungary $14 billion at below market rates to finance the construction of additional nuclear energy production units at the existing Paks nuclear power station.
The announcement is one more piece of evidence showing that Russia continues to diversify its income by exporting nuclear power stations to as large a market as possible. It is winning sales competitions by providing as complete a product as the customer desires. The components of a deal for a nuclear power plant project available from Russia include manufactured parts, engineering services, construction, operations, maintenance, fuel, used material handling and finance.
Recent offerings to countries without nuclear experience or a domestic infrastructure, including Turkey and Vietnam, include a full build, own, operate model. The host country doesn’t need to do anything other than to provide a site and agree to purchase the electricity from the plant once it is operating. At the other end of the deal spectrum, like those with US nuclear power plant operators, Russia’s only participation is to provide enriched uranium.
Russia is viewing Nuclear energy as a more stable long term market than their oil and gas.
In the Pacific Northwest, hydro-electric power load follows when wind power is available, wiping out any emissions or cost benefit. Over the last several years, we’ve spent about $5 billion and impacted over 50,000 acres of pristine public land for the privilege of throwing away 9 billion Kw-hrs of carbon-free energy every year.
Next Big Future – Al Gore doesn’t think climate change important enough to build new nuclear power or start geoengineering
Brian Wang is a Futurist Thought Leader and a popular Science blogger with 1 million readers per month. His blog Nextbigfuture.com is ranked #1 Science News Blog. It covers many disruptive technology and trends including Space, Robotics, Artificial Intelligence, Medicine, Anti-aging Biotechnology, and Nanotechnology.
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